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Wednesday, December 9, 2015

It really shouldn't come as a surprise that older multifamily communities in Florida (and elsewhere in the country) have serious parking problems these days since those communities were built decades ago when families used fewer cars.

Today, people move into these communities with three, four and sometimes five cars in tow. In condominiums and cooperatives, there is limited space in the parking garages and parking areas. In homeowners' associations, parking on the streets and in private garages (many of which are inaccessible due to the fact that they are used as storage units) can be just as problematic.

The proper management of parking spaces is necessarily tied to how parking spaces are classified in a community's governing documents. In some communities, one or more spaces may be appurtenances to the units, meaning they are conveyed via deed along with title to the unit and cannot be split apart from unit ownership. In other communities, all spaces are defined as common elements which are freely assignable by the board whereas in still other communities, parking spaces are limited common elements which means they are used exclusively by the owners to which they are assigned.

Boards dealing with parking problems often have to navigate amongst the following:

Requests for reassignment of parking spaces;

How to accommodate disabled parking requests;

Insufficient guest parking, particularly during holidays;

Initial Developer parking assignments which have been ignored or forgotten over many years; and

Owners swapping parking spaces without the authority to do so.

There are a variety of ways to handle parking space problems including possible amendments to your declaration and/or rules and regulations in order to update an antiquated system put in place decades ago.

Even brand-new communities can have persistent parking problems. Recently, a large part of the appeal of a shiny new building in Miami-Dade was its "automated parking garage". The Robotic Valet was intended to eliminate the need to fight over spaces, remove any concerns about security and generally make residents' lives easier. It all sounded wonderful but the room for mechanical and human operator error quickly became apparent with some owners waiting for hours for their cars to arrive. One of the areas which was overlooked was peak hours for vehicle retrieval requests. Another was the need to get robotic parking right if you build a garage with a reduced number of parking spaces!

I grew up in Chicago and one of the most iconic buildings downtown was the Marina Towers, mostly due to its unique open-air parking structure. As kids, we used to think about how cool it would be to live there and park a car there. Last summer when I visited my hometown, I passed the building and shuddered when I thought about what a potential mess their parking situation might be.

If your community is having parking problems or you just want to be proactive in this regard, please speak to your association attorney for some solutions.

Monday, November 23, 2015

It happens on a weekly, sometimes daily basis. I receive a question from a blog reader and the question is not general in nature; in fact, the question seeks legal advice (often on a fairly significant matter that involves potential liability) which can only be provided after thoroughly reviewing the reader's governing documents and rendering a legal opinion. My standard response is usually: "Do you have an attorney for your association?"

Ninety percent of the time, the blog reader responds that the association does have legal counsel and then offers a reason why the association's counsel was not contacted with the question. The reasons run the gamut from the lawyer being inept to the reader thinking the question was not important enough to contact the attorney.

I understand, however, that the real reason is often that most people hate paying legal fees and if they can get a free first or second opinion from a blog, other social media source or even just a retired out of state lawyer at a cocktail party, all the better in some minds. These efforts to avoid paying legal fees cross many practice areas. For example, I am amazed at how often people will sign contracts without counsel's review and with apparent disregard for crucial items like warranties, indemnification, adequate insurance coverage, dispute resolution and venue and more. On the other hand, people facing criminal charges are far more likely to pursue and pay for quality legal assistance in order to avoid going to jail.

Unfortunately, community association directors often believe they can squeak by with advice from whatever source is cheapest or, even better, free. Some boards will go so far as to pressure their association manager to provide such advice under the belief that the service falls within the scope of their management fee. In terms of lessons being learned the hard way, many who seek discounted or free legal advice get what they pay for and overlook the fact that when things go awry (as they often do when human behavior is involved) that they will eventually need experienced legal counsel. Such representation will be more costly and more complicated as a result of the delay, especially if litigation results.

What if instead of avoiding legal fees like they were the plague, board members and managers simply became more sophisticated consumers of legal services? When deciding whether or not to seek proper legal advice on a matter, that decision must include an acknowledgement of what costs might ensue should things go wrong. Moreover, legal expertise, successful track record and a communication style which facilitates trust, understanding and dispute resolution are all more important factors than hourly rate when choosing an attorney.

Abraham Lincoln is quoted as saying, "A lawyer’s time and advice are his stock in trade." As lawyers, we are selling our expertise to consumers who hopefully understand the difference between what is free and what is in their best interests.

Monday, November 2, 2015

Many communities rely upon name recognition and a certain style logo to attract attention from potential new purchasers as well as to enhance real property values for existing owners.
I live in a country club community that has a distinct font and logo which is intentionally highlighted on our association website, advertisements, business cards, stationary and, naturally, our community signage. For the sake of this blog, we will call my community Ridgeview Golf Estates. We have spent considerable effort and money over the years to build a certain mystique around the name and the look. What we failed to do, however, was to register the name and logo as our trademark and, as a result, we have had businesses in the vicinity trade on our good name over the years to the point that we now have the Shoppes of Ridgeview Golf Estates (with some less than desirable stores) and neighboring communities who use Ridgeview Golf Estates in their name even though they are not affiliated with my community. Often, well-known communities wind up with local realtors, security and pool companies and other vendors incorporating the community name into their business name in order to trade on the community's brand and reputation. By putting their names in the public eye, such exposure can give rise to trademark rights for these businesses which a community can later find difficult to challenge and can also make it harder for a community to later trademark its name in the face of these other trademark rights.
While a federal trademark registration may not be needed for most community association purposes, state trademark protection for your community's name and logo is advisable for a number of reasons.
A search of the all-state database will reveal online trademark records with other marks that begin with the words contained in the community's name or the like. Often, this search will reveal business names that have or include your community's name. Even if similar business names may not be registered as trademarks, nonetheless these business names could be used in such a way as to develop trademark rights in the companies that are using these names. Thus, there should be some attention paid to these names as trademark rights could exist in them even if the business owners in question are not fully cognizant of their having such trademark rights.
It is important for communities to be aware that a third party could be accumulating trademark rights in a mark containing some variation of their name even without any trademark registration or any company-name registration or any other type of registration. The mere fact of using a name or mark in the public eye automatically gives rise to trademark rights. If these third-party users are far enough away from the community geographically, an argument can be made that the association should not be prevented from registering its own trademark.
In light of what else is out there in the public eye, your Intellectual Property (IP) attorney may suggest that your association should claim your rights narrowly by limiting your claim to only a stylized mark with specific design elements of your logo.
Speaking of the design portion of your mark, there are copyright issues that come into play. Copyright exists in the artwork as such, whether or not included as part of a trademark. Normally the individual artist who created the artwork would own the copyright in it. Alternatively, if that individual created the artwork in question as part of his or her normal job duties for an employer (such as an ad agency) then that employer would own the copyright in it. Either way, an association could not make use of this artwork as part of its trademark without authorization from the copyright owner, or without having that copyright owner transfer over to the association the copyright in the artwork. The fact that the association paid for the artwork to be prepared does not in and of itself accomplish any such transfer. On this subject of third party rights or creations generally, it is important for associations to be aware that as they progress further in preparing materials and taking other actions as to their websites, social media sites, advertising and other materials, they should be mindful of the possibility of trademark or copyright issues arising by virtue of using the materials of third parties.
If your association is taking the time to thoughtfully create a name and logo, it only makes sense to protect that investment. I am always surprised that most developers do not take the time to register as trademarks the names and logos of the communities they create. However, even if your developer neglected to do this, your Board of Directors is able to do so and should consider adding this item to your "To Do" list. A state trademark registration is not cost prohibitive and can provide a lot of peace of mind for years to come. Directors, managers and developers wishing to learn more about the trademark process can contact me at dberger@bplegal.com.

Monday, September 21, 2015

A nuisance is generally defined as a person, thing or circumstance which causes inconvenience or annoyance. For some people living in shared ownership communities, there is no escaping a nuisance situation that has risen to a level which impacts the enjoyment of their homes and their community.

If you have ever suffered through a nuisance scenario, you may understand how hard it can be at times to achieve consensus on whether or not the activity in question is an actionable nuisance. Is that television really being played at a blaring decibel level or is the neighbor just particularly sensitive or, worse, looking for a new angle in a personal fight?

In a community association setting, nuisances can come in many forms.

Loud, consistent noise either in the form of music, yelling, use of electronic devices or failure to properly soundproof flooring in a multifamily building

Pets-barking, defecating, biting, and running around off-leash

Secondhand smoke-spilling into neighboring units, balconies and common areas

Odors from cooking, chemicals and other sources

Hoarding-creating conditions for insect and rodent infestation into neighboring units and common areas

Domestic violence-frequent arrival of emergency services and police at all hours

Visually unappealing property condition-one example would be an overflowing dumpster sitting in front of a house undergoing renovations for months

Short-term rentals

A general nuisance provision is standard in most developer-drafted documents. However, it is rare to find a nuisance restriction that is fully fleshed-out; one which clearly defines the various conditions or behaviors which constitute a nuisance in that particular communities and which can therefore be more readily abated by enforcement efforts. When confronted with a nuisance, the starting point is to find out what is driving the behavior or condition and identify the quickest way to resolve the problem. Sometimes the behavior is driven by a mental illness and other times it is a deliberate attempt to annoy.
If an owner is unwilling to cure the nuisance activity, the association's options may include fining, suspension of common area use rights and pursuing a Court Order to force the behavior or activity to stop. All enforcement will be easier if the activity or behavior is clearly identified in your governing documents as being a nuisance rather than having to debate the issue.

Next time you decide to update your governing documents, please discuss what changes should be made to your nuisance restriction with your association attorney.

Not planning to update those antiquated documents any time soon? Stay tuned for a future blog post on why allowing your documents to remain stagnant is a big mistake!

Monday, August 24, 2015

Does your board consider itself "special" in
the eyes of your insurance agent? Do you believe your agent has a duty to
advise you whether or not the coverage you are purchasing and the limits you
are seeking are sufficient?

You
might be under the illusion that your agent owes you a greater duty than he or
she really does unless your relationship meets a certain standard.

Your
board may believe that your insurance agent has a duty to advise you, among
other things, about the type of coverage you need and the amount of limits you
should carry. However, in the absence of a "special relationship" and
certain circumstances, you may be sorely disappointed to learn that your
relationship with your insurance agent is merely "ordinary".

In
an "ordinary" client-agent relationship, the agent typically has the
following duties to his or her client:

to
procure the insurance coverage requested by your board using a level of skill,
care and diligence which is standard in the industry;

to
inform your board if he or she cannot procure the coverage you have requested;
and

to not mislead or misinform your board
about your coverage.Courts
are more likely to hold an insurance agent to a higher standard of care with
special relationship clients, so it makes sense for your community to become
one of those "special relationship" clients. So how do you do it?

-Seek out an agent who is recognized as an expert in
the industry.

-Insist on a relationship with your agent that consists
of more than just the purchase of a policy or policies.

-Ask your insurance agent to serve as a professional
adviser in terms of the coverage you are seeking and get him or her to confirm
that role in writing. This role should also be filled by your association
attorney. If you do not understand your insurance purchase, ask your agent to
explain it to you, in writing.

-Demand extra time and resources from your agent
particularly if you are paying him or her any compensation in addition to his
or her commission.

-Have a long-term relationship with your agent.

If
you would like more out of your relationship with your insurance agent than
simply a sales transaction, you will need to demand it. By doing so, you may
also be able to hold him or her responsible for any negligence in the
unfortunate event you do not receive the proper advice.

Friday, August 7, 2015

Florida's Department of Business and Professional
Regulation pays six full-time "Senior Attorneys" to act as
arbitrators in the Arbitration Section of the Division of Condominiums,
Timeshares and Mobile Homes approximately $52,000 per year to handle numerous
disputes throughout the State. The alternative dispute resolution provisions
found in Section 718.1255 of the Florida Statutes were designed to prevent
Florida court dockets from being clogged with certain types of disputes which
routinely arise in the condominium and cooperative setting as well as to
provide a more cost-effective option to court litigation for owners.

Florida's condominium arbitrators feel that they are
grossly underpaid in comparison with other hearing officers employed by the
Sunshine State and, it turns out, they are probably right.In a May, 2015 "desk audit, Florida's
DBPR arbitrators asked the state to reconsider their salaries. In their
request, the arbitrators state that the work they perform is analogous to that
performed by the attorneys employed as Public Employee Relations Commission
(PERC) Hearing Officers who preside over disputes of limited jurisdiction. For
comparison's sake, PERC hearing Officers earn $90,047 annually. Another
comparable position is the Reemployment Assistance (RA) Appeals Manager for the
Department of Economic Opportunity. RA Appeals Managers earn an annual salary
of $84,999.96.

There are only six Division arbitrators (plus the chief)
for the entire state. The DBPR collects millions in fees each year from
condominium and cooperative owners. Sadly, those funds are usually diverted to
the general operating budget each year. Regardless of how you feel about the
Arbitration Program, its effectiveness or attorneys in general, having
experienced attorney arbitrators to resolve association disputes is a good
thing. Underpaying people is a surefire way to have them look elsewhere for a
job.

Is the message here that the resolution of association
disputes just aren't as important or valuable as other types of disputes being
handled by State Agencies? If the reasons articulated in Section 718.1255(3),
F.S. for the creation of an alternative dispute resolution system remain true,
why is the State balking at properly funding that system?

If you agree that Florida's Community Association
Arbitrators should be paid commensurate with arbitrators for other state
agencies, you can contact Ken Lawson ken.lawson@myfloridalicense.com
and Kevin Stanfield at Kevin.Stanfield@myfloridalicense.com
and let them know you want them to approve the arbitrators' request for salary
review.

Monday, July 20, 2015

The Florida Legislature recently approved a new law which
will allow community associations to conduct their elections online through the
use of electronic voting. While associations in other states have had this
ability for some time now, this is a sea change for the millions of Floridians
living in shared ownership communities.

For years, many of the disputes in condominiums,
cooperatives and homeowners associations, have stemmed from the annual meeting
and election process. People who ran for the board and weren't elected were
convinced that the current board or the manager who doesn't like them somehow "kept
them off'.We've heard tales of ballot
boxes being stuffed, tampered with and altogether ignored. In the condominium
setting, allegations of forgeries on outer envelopes is always a concern while
in the HOA setting, complaints of rampant proxy abuse are common in connection
with the election of the board members.

Howard Perl, a Shareholder with the law firm of Becker
& Poliakoff, has handled these disputes for more than a decade. "Many
of the disputes involve judgment calls. Some ballots are discarded when they
shouldn't be and others are allowed when clearly they should have been
invalidated" he explained.

Election disputes don't come cheap. They are subject to
mandatory arbitration with a Florida state agency and can cost up to $5,000 or
more depending on how hotly contested the matter is.Florida's Department of Business and
Professional Regulation will be meeting in early August to begin drafting rules
to address the new statute.

Now that the path has been cleared to allow Florida's
associations to utilize online voting, the question remains whether this move
will result in fewer or greater complaints associated with electing a
community's board of directors.Remember
the national focus on the Sunshine State's unfortunate hanging chad incident?
Hopefully, we will not have a repeat performance and our Florida communities
will embrace this new option as one which will (a) likely increase voter
participation and (b) reduce the possibility for voter fraud.

Tuesday, July 7, 2015

The U.S. Supreme Court
has been in the news a lot which is not surprising given its recent newsworthy
rulings. However, there is one ruling that could impact the community
association industry profoundly. The 5-4 Supreme Court holding in Texas
Department of Housing and Community Affairs v. Inclusive Communities Project, could
have wide-ranging impact on community association boards. Previously, a board
was diving into dangerous waters when it passed rules and restrictions with the
intent to treat people differently. Under the new Supreme Court ruling, a board
can be held liable for housing discrimination whether or not anyone on the
board intended to discriminate so long as the rule or restriction has a
disparate impact on a legally protected group of people.

Boards will have to show that (a) they had a good reason for the rule or
restriction and (b) there was no way in which to accomplish their reasonable
goal in a manner which had a less disparate impact.

So how could this impact your community?

Many members wish to ensure the continued success of their community by
regularly amending the documents. Often those amendments allow their boards to
thoroughly screen new tenants and new purchasers to ensure that newcomers will
not present a financial burden on association (if a member cannot pay
assessments, the remaining members must make up the deficit) nor will they
present a threat to the health, safety or welfare of the community.

Do the following restrictions which are fairly standard in the community
association arena create disparate impact concerns?

-Screening applications which inquire about credit score, employment status
and other indicators of financial stability.

-Requirements
that a new purchaser have a certain equity interest in the property being
purchased.

-Rules
involving access to an association's pool and other common areas that may
impact families with children

While
the ruling isn't a reason to panic or to abandon any attempt to pass and
enforce reasonable rules in your community, it does make it more important than
ever that you discuss your restrictions with your association attorney prior to
implementing same in order to decide whether or not there will be a disparate
impact and whether or not there is a way to accomplish your goals without
creating a disparate impact.

The
four dissenting justices voiced their concerns that the majority decision is
based on the Griggs v. Duke Power Co. case rather than focusing on the actual
intent and text of the Fair Housing Act. In the Griggs case, 401 U.S. 424
(1971), the Court held that black employees could recover from their employer
under Section 703(a)(2) of Title VII of the Civil Rights Act of 18-964
without proving that the employer's conduct (the employer required a high
school diploma or a qualifying grade on a standardized test as a condition for
certain jobs) was motivated by a discriminatory intent.

Tuesday, June 23, 2015

In an opinion filed on June 22,
2015, the 1st DCA ruled in the case of Security First Insurance Company vs.
State of Florida, Office of Insurance Regulation that the OIR was correct in
not allowing Security First Insurance Company to change language in its
policies which would restrict the ability of policyholders to assign policy
rights without the insurer's approval.

This is the second ruling in
little more than a month (the first ruling was issued by the 4th DCA) which has
supported a policyholder practice known as an "assignment of
benefits". This practice often occurs when a homeowner or an association
hires a contractor to make necessary repairs in the aftermath of a hurricane,
other storm or other casualty event such as a water leak. Once those policy
benefits have been assigned, the contractor then pursues payment directly from
the insurance company. Insurance companies have argued that the practice of
assigning benefits can encourage inflated costs and fraud. Policyholders and
contractors argue that the practice allows cash-strapped communities to recover
more quickly from emergencies.

Security First attempted
to change its policy language to the following:

“Assignment of this policy or
any benefit or post-loss right will not be valid unless we give our written
consent.”

On July 22, 2013, the Office of
Insurance Regulation (OIR) denied Security First's request claiming that the
change in language would “violate the intent and meaning of Sections
627.411(1)(a), 627.411(1)(b), and 627.411(1)(e), Florida Statutes[, and]
contain[ed] language prohibiting the assignment of a post loss claim under the
policy, which is contrary to Florida law.”

A three-judge panel of
the appeals court said state law has long allowed assignments of insurance
benefits. "On this point we find an unbroken string of Florida cases
over the past century holding that policyholders have the right to assign such
claims without insurer consent." The 1st DCA Panel held that the matter of
whether or not the practice of assignment of benefits should continue would be
more properly addressed by the Florida Legislature. In fact, Florida
legislators considered
a pair of bills (HB 669 and SB 1064) in the 2015 Session that would have
substantially restricted assignments of benefits but both bills failed.

Not
discussed in these cases was the more practical question of whether or not an
assignment of benefits to a contractor is a wise decision for an association.
Fortunately, we have not had a hurricane impact Florida significantly for more
than a decade but in the aftermath of the tumultuous 2004-2005 storm seasons,
we saw many out of state, unlicensed and unknown contractors arrive in
communities at a time when they were most vulnerable. A Board's priority in the
immediate aftermath of a disaster is to mitigate further damage. Negotiation on
overall repairs requires deliberation, thoughtful negotiation and careful
review of the contract.

The
moral of this blog post is just because you can do something does not
necessarily mean you should.

Monday, June 8, 2015

Last night I watched a classic American film-12 Angry Men. The title actually refers to the twelve jurors deliberating the fate of a boy on trial for murdering his father but could just as easily describe the average master association board of directors.

I am sure many of my blog readers have seen this movie but for those who haven't, the entire film takes place in a hot, stuffy jury room. Henry Fonda starts out as the lone hold-out with his Not Guilty vote and he faces the wrath of his fellow jurors who want to get to a ball game, their jobs or their homes and do not appreciate his dissenting voice delaying their escape from their confined quarters.

At one point, a juror accuses Fonda of being talented at the "soft sell" negotiation technique. Fonda doesn't attempt to shout, scream or bully in order to get his fellow jurors to slow down in their rush to judgment. Instead, he bravely admits that he doesn't know whether or not the boy is guilty but he would like to talk about it a little and ask some questions before rendering a verdict which will end the boy's life. Eventually the discussion results in the other jurors realizing that the evidence they had relied on so heavily and hastily could not support a guilty verdict and an unanimous acquittal results.

While the decisions made in association board meetings are not nearly so significant, those decisions still can impact the quality of life for many people. How often has a member of a community association board felt that the rationale being expressed by some or the majority of his or her fellow directors was not in the community's best interests but remained silent for fear of being rebuked or rejected? Conversely, how many directors do stand up and voice their concerns but do it in such a hostile manner that their message is drowned out by their rhetoric? Association members can also be the right messengers at times when a majority mindset needs to change.

There are a lot of lessons to be learned from 12 Angry Men for the many thousands of volunteers serving on community association boards.

Speak up, especially if the stakes are high.

Present your message in a way that makes your fellow directors really hear what you are saying.

The way to unmask the extreme members of your board is by giving them enough room to do that task themselves in the face of unemotional data.

If you haven't seen the movie in a while or have never seen it, perhaps it's time for movie night in your community.

Monday, May 25, 2015

Given the significant percentage of Floridians living in all types of shared ownership communities, it is not surprising that each year we see at least a handful of bills pass which directly or indirectly impact those private residential communities and one primary association bill which contains both substantive changes and technical fixes needed to address glitches associated with the legislative changes from prior years.

2015 was no different. Florida's 60-day Legislative Session recently ended (and abruptly with the House adjourning several days early) with another omnibus association bill, HB 791, having passed; that bill is now on the Governor's desk awaiting his action. The Governor is likely to sign this bill into law and it will become effective on July 1, 2015.

Among other changes, HB 791 will help Florida condominiums, cooperatives and homeowners' associations catch up with the digital age thanks to the following changes:

Sunday, May 10, 2015

Before agreeing to serve on your community association's Board of Directors, please do yourself and everyone else a favor and run through these five questions first.

1. Do I have time to serve on the Board?

Running and being elected to your community's board of directors can be an exciting experience as it is an affirmation of sorts. However, once the election is over there is that little matter of actually attending meetings and handling the work that may be delegated to directors. In self-managed communities, your successful service on the Board is likely to be even more dependent upon your ability to carry your share of the workload. If you have certain circumstances in your life which would prevent you from being an active and responsible director, you should reconsider your decision to serve..

2. Can I make unpopular decisions?

Being a community association director should not be a popularity contest. As a director, you will be asked to make decisions which can upset your neighbors. These decisions can range from having to lien and foreclose on the nicest guy in the community as well as passing a costly special assessment to make necessary roof repairs. You cannot play favorites and you should not abstain from casting your vote because you want to be liked. Also, trying to "fly under the radar" by allowing a dominant director or directors to make all the decisions or abdicating control entirely to a manager is a choice that will will likely come back to haunt you.

If you cannot bear the thought of making someone unhappy (including yourself), then serving on the Board might not be for you.

3. Do I have an ax to grind with anyone?

Do you see serving on the Board as an opportunity to help your community or is it a chance to use the position with a less than noble goal in mind? While there is nothing wrong with new Board members joining with a goal towards correcting a former board's mistakes, there should be concern if the battle is a more personal one with a neighbor or vendor. Board service requires a neutral stance where you are making decisions based on the overall good of the membership and not for personal gain.

Be honest with yourself about your intentions for serving on the board because if they aren't good, you won't fool anyone for long.

4. Am I willing to read and comply with the governing documents?

I have been reading governing documents for two decades and I have yet to come across a set which would qualify as a thriller. When you include amendments passed over many years, some governing documents can be comprised of hundreds of pages of legalese so reading them is not on most people's "Wish List". Still, if you agree to serve on your community's Board, you have an obligation to read those documents. No, you do not have to perfectly understand them-that is what your association attorney is there to explain. You do, however, have to be prepared to comply with them along with everyone else. Also, attending a class each year will not only make you a better director, it might make you happier serving on the board.

5. Do I have skills that would assist the community?

Despite what some owners might think, association directors are not tied to a standard of perfection. These volunteers are human and they will make mistakes. Community association directors are tied to a reasonableness standard so one of the greatest skills you can bring to your Board of Directors is that of being a reasonable person willing to listen with an open mind, eager to seek assistance from experts when an issue is beyond your skill set and mindful of the tone and content you use when communicating with members, fellow directors and vendors.

I served on my HOA Board for a two-year term and during that time we undertook some major community projects, we made a few mistakes and I found myself on the losing end of more than one vote. I applaud everyone who volunteers and serves on a community association board with the right intentions. It is not an easy job but it does give you a different perspective from that point forward!

Thursday, April 30, 2015

Has
your condominium or cooperative board been contacted by a member who has been
impacted by a neighbor's nicotine habit? Has your Board struggled to understand
what your obligations are and how much it will cost you to find out?

By defining secondhand smoke as
a nuisance, local and state governments can do the heavy lifting for
condominiums and cooperatives who are struggling with this issue.

Some of the actions taken by
the following California cities to address the topic of smoking in rental
apartments could be modified by our Florida legislators to address the issue of
excessive secondhand smoke in our State's condominium and cooperative
communities.

In
2006, the City of Dublin declared secondhand smoke to be a nuisance. One
Dublin couple won a restraining order against a downstairs neighbor whose smoke
invaded their unit through shared ventilation and windows – the judge issuing
the order cited the nuisance provision as well as a year’s worth of email
exchanges over the situation. Dublin eventually adopted a 75% non-smoking
units law in 2013.

In
2009, the City of Richmond adopted a law banning smoking
in all multi-unit housing of two units or more which law became effective Jan.
2011. Richmond has a special hybrid police/code enforcement team of sworn
officers called the Regulatory Unit which enforces the non-criminal
code violation calls. When a tenant calls about a smoking neighbor, an
officer will go the unit and take a complaint. The officer will attempt
to speak with the property manager/owner and will ask to see a copy of the
smoke-free lease that each tenant should have signed as of Jan. 2011. The
officer also checks the property to make sure that the required signage is up
and asks to see the letter that landlords must send out to tenants to inform
and remind them of the law. If time permits, the officer will also
attempt to contact the alleged violator. If that person is home and
answers the door, the officer will talk with him/her about the law and the need
to comply. The officer informs the complainant to advise the Regulatory
Unit if the problem persists. If the owner/property manager is not using
the proper lease, sample letter and/or signage, then he or she is asked to take
remedial steps, with the officer checking back in one month’s time to confirm
compliance. Violation of the ordinance is considered a nuisance under the
city’s Code which means that the city may, if it so chooses, levy a fine
against the property owner for each day that the violation continues.
Having a uniformed officer take a police report seems to have done the
trick in terms of discouraging smokers from continued violations as no fines
have been levied to date.

At
the end of 2013, the City of Berkeley, adopted a law which took effect May 1,
2014 requiring all leases issued after May 1, 2014 to be non-smoking. Existing
lease holders were asked by landlords if they would be willing to voluntarily
sign a new smokefree lease addendum and many did agree. Nonetheless, as
of May 1, 2014, it was illegal to smoke inside apartment and condominium
units in Berkeley. Since this law's inception, only one
person has been cited. Some Berkeley landlords are also attempting to
check on the status of these complaints as proof of nuisance behavior which can
be used in an eviction action.

In
addition to California, Utah
defined secondhand smoke in 1997 to be a nuisance as it pertains to multi-unit
housing. Some states classify secondhand smoke as a nuisance-is it time for Florida to follow suit?

Sunday, April 5, 2015

In the for-profit corporate world, titles are important but they do not make someone a leader simply by virtue of having one. However, in the not-for-profit community association world, a title can endow its holder with an inordinate amount of power to make decisions on behalf of a lot of people if the rest of the board becomes cowed, lazy or indifferent.

There are usually two types of directors serving on condominium, cooperative and HOA boards: those who strive to become a board officer and, specifically the President, and those who refuse to accept such responsibility.

For the former group, just what is the appeal of becoming the board president?

The governing documents typically outline each officer's duties and for Board President, that can include creating the agenda for meetings and chairing those meetings.

Any director even those who are not officers can sign a contract if given actual authority to do so via Board Resolution. However, most vendors insist on getting their contracts signed by an officer of the Board and specifically the President. The President has what is called apparent authority to sign contracts meaning that to the outside world, he or she is presumed to have such authority.

The myth persists that a Board president can break ties. This is only true if the President of your Board also serves as the Vice President of the U.S. and is voting to break a tie in the U.S. Senate.

There is just something about the title President which puts a little spring in some people's step.

When I meet initially with boards who are experiencing some level of dysfunction, the complaint I hear most often is that the board president is making unilateral decisions that are not in the community's best interests. While a rogue president cannot be removed from the board entirely (only the members can vote to recall a director), any Board officer can be removed by the vote (which can be cast by secret ballot) of the board members alone. Removing the president's title does two things: it removes his or her apparent authority as well as relinquishes him or her of the duties of the office set forth in the governing documents. Such decisive action also sends a strong message that the board insists on operating as a cohesive entity.

In highly functioning communities, the title of president should not present any particular worries or concerns because those boards are voting on items and taking action as a fully-informed group. If you are asked to serve as a president in one of these communities, accepting the position should not be a cause for sleepless nights.

Lastly, just remember, you can run but you can't hide. If you serve on your Board and you have abdicated all responsibility and decision-making to your fellow director or directors, you can still be sued if he, she or they make the wrong choices.

Sunday, March 29, 2015

I am going to preface this blog post by stating that there are individuals who struggle with emotional disabilities and who can legitimately benefit from the use of an emotional support animal.

However, this blog post is not about those people.

Unfortunately, those of us who live in shared ownership communities, serve on their boards or represent these types of communities have all seen our share of abuse in this area. The legal pendulum seems to have swung very far in the direction of protecting the rights of people who want pets in "no pet" communities regardless if those people have fraudulently framed their requests as being a necessity for their emotional well-being. Meanwhile, the rights of people who specifically purchased a home in a pet-restricted community due to allergies and other health issues, fears/phobias or simply preference are not protected by the government with the same fervor and the board is often prevented from protecting their rights..

I have seen the following animals requested for emotional support:

Dogs

Cats

Birds

Monkeys

Mice

Snakes and other reptiles

Pigs

Miniature Horses

Ferrets

It is important to remember that even though the local Fair Housing investigators continue to remove most of an association's ability to properly evaluate an emotional support animal request, the ultimate accommodation still must be reasonable in nature. It is imperative that your board not go it alone when it comes to receiving and responding to one of these requests. Speak to an attorney who is well versed in these issues and who can provide you with the greatest likelihood of successfully navigating this minefield.

One owner in a "no pet" community claimed his girlfriend needed to bring her emotional support animal with her when she came to visit him for their occasional conjugal visits. The association fought this request and, with our Firm's help, prevailed. Another owner insisted that the dog needed by her late husband for depression is now needed by her since she is depressed in the aftermath of her spouse's death; that case is pending. Yet another owner requested a single parrot for his emotional issues and then decided he needed two more. He started bringing the parrots with him to the pool (sauntering around like a pirate according to some unhappy neighbors) and when the parrots started to attack others at the pool, all of the birds were removed since they were deemed to no longer be a reasonable accommodation.

So what is your community's most outlandish emotional support animal request and how did you handle it?

To attend our class on emotional support and service animal requests, please visit www.bplegal.com/events.

Sunday, March 22, 2015

I often wonder what variables factor into an association board's decision to forego professional management and an annual retainer relationship with a law firm in favor of "going it alone".Naturally, money is top of mind for most directors when deciding whether to use professionals such as managers and lawyers for their community. However, financial concerns should not be the only topic of discussion during this debate. In addition to the costs involved. boards should ask themselves the following questions when deciding if they wish to be self-managed:

Are we comfortable with handling requests from owners and pursuing covenant violations directly as opposed to having a "cushion" provided by our manager?

Do we have the time, patience and expertise to follow through on the daily operations of our community?

Do we have the time, patience and expertise to follow through when something out of the ordinary arises like a fire, hurricane or other disaster?

Are other communities of our size and type typically managed professionally or self-managed?

I have lived in a Broward County homeowners' association for more than twenty years and our community has always been self-managed. Our community could really go either way. We are relatively small (98 homes) and do not have a plethora of common areas although we have enough features (private roads, green parks, gazebo, guardhouse, perimeter wall and gate) that do require consistent maintenance and oversight. Someone buying in our community may very well expect it to be professionally managed but would likely not be shocked to learn it isn't.

On the other hand, a high-rise condominium on the water would present a host of operational and maintenance challenges which might prove far too taxing for the average volunteer board of directors no matter how enticing the cost savings may be. This is when the old adage "penny wise and dollar foolish" comes into play.

As for boards who decide to forego legal assistance on issues like covenant enforcement, document amendments, contracts, insurance claims, hiring and firing decisions, land acquisitions, easements, recalls and more, the questions I would urge them to ask would be:

Is our D&O coverage current and high enough and do our actions in this matter exclude coverage?

Will we be able to hire the attorney(s) we want when we want them for this matter?

Are we willing to learn a lesson the hard way?

Sometimes boards relax into patterns and deciding to forego useful professional assistance can be a bad one.

Friday, March 6, 2015

When you go to your doctor, it is helpful if you can accurately describe your symptoms so he or she can properly diagnose the problem. The same holds true when a volunteer board of directors meets with its legal counsel.

Boards can inadvertently make a legal diagnosis more difficult when describing a problem by not being concise with certain terminology.

For example, many directors will refer to a certain provisions being in their "Bylaws" as if it was a catchall term encompassing all of their documents. In fact, the Bylaws are one of several governing documents which comprise the foundation for association operations. In a condominium association, you will have a Declaration of Condominium, Articles of Incorporation and Bylaws. In a cooperative association, you will find Bylaws and a Proprietary Lease but no declaration. In a homeowners' association, your community will be governed by a Declaration of Covenants and Use Restrictions as well as a Bylaws and Articles of Incorporation. All of the foregoing shared ownership communities will also typically have separate rules and regulations.

When your board refers to your "Bylaws", your legal counsel is already picturing a certain document depending on your community type and it may not be the document to which you are actually referring.

Another area where directors can sometimes mislead association counsel and others is by referring to their community as a "homeowners' association" when, in fact, it is actually a condominium or cooperative association. True, every community is comprised of homeowners but an HOA is a very different entity than a condominium, timeshare, mobile home or cooperative community. When referring to your community either internally to other directors and members or to professional advisors and vendors, please use the correct term.

Lastly, some directors (and association members) still refer to Florida associations being subject to "the Sunshine law". While each of Florida's shared ownership statutes do require a certain level of transparency in association operations, Florida's Sunshine Law (Chapter 286, F.S.) pertains to governmental entities and not to private residential communities so saying that your association is "subject to the Sunshine law" is not technically correct.

Remember, being precise (and accurate) in the terms you use to describe your community and its issues can only help shorten the time it takes to diagnose and resolve those issues.

Sunday, January 25, 2015

How many times have you thought about resigning from your association's board of directors because you felt that your efforts and time were not appreciated at best and were resented at worst? I often tell my association clients that I understand how they feel because I do. I served on my HOA Board for one two-year term. While the overall experience was positive and certainly beneficial considering what I do for a living, I remember one uncomfortable incident that occurred during my time on the Board.

One director (we'll call him Jim for the purpose of this blog) decided that having a certain plant material installed in the community was of utmost importance to him. Jim was ordinarily a very nice guy. However, when I mentioned to him that nothing in our association's governing documents actually authorized the planting project he was steadfastly pursuing, he became a little perturbed. Jim became so perturbed in fact that he asked me to resign from the Board to "maintain our friendship". I was taken aback by the request but gave it some thought and ultimately decided that resigning to avoid a conflict was not the right thing to do. While I often counsel directors that making tough decisions is really a job requirement, I also tell them to consider quality of life issues if the stress of being on the board is too much.

Still, I have seen some directors resign in a huff only later to regret that decision. In Florida, Section 617.0807 of the General Not For Profit Corporate Act provides that a director may resign at any time by delivering a written notice to the board of directors. Such resignation is effective when the notice is delivered unless the notice specifies a later effective date.

The statute further provides that resignations must be in writing and most reasonable people agree that email constitutes written communication. Among the other pernicious aspects of email, resigning in a huff via email can pose a huge problem for association directors who later regret that decision. The statute does not require anyone to actually "accept" the tendered resignation so if a beleaguered director writes an email to his or her fellow directors tendering a resignation in the hopes that someone will talk them out of it, it is already too late as they are off the Board. Of course, he or she can appeal to the board to be reappointed to the seat he or she just vacated by virtue of resigning but there is no guarantee that will happen.

If you are an association director who is considering resigning from your board as a result of conflict with fellow directors, time constraints or perceived hostility from your members, take your time to deliberate on the matter before hitting send on that resignation email.

Tuesday, January 20, 2015

Attorney Donna DiMaggio Berger will be a guest on the “Condo & HOA Hour” on radio station KKNW 1150 AM Wednesday, January 21, 2015. Ms. Berger will provide commentary on national trends in the community association industry and discuss how technology is affecting HOAs and condos, and how volunteer board members are getting the education necessary to effectively lead their communities. The show mixes education, entertainment, guests, features, and call-in conversations.

Ms. Berger is a well-known condominium attorney and shareholder in Becker & Poliakoff’s Community Association Law Practice. She is active on social media and authors the popular “Community Association Law” blog on timely topics and issues of interest for common interest ownership communities.

She has created and manages the popular Condo and HOA Law & Living Group on LinkedIn and companion Condo and HOA Law & Living Group at Facebook, two of the most active social networking groups for community association residents and professionals. She also shares news and views on community association law and living on Twitter at @CondoandHOALaw.

Sunday, January 11, 2015

The other day I was flipping through an industry magazine and came across an ad touting a law firm that highlighted the firm's ties to a particular state and a particular practice area. It conveyed a strong message that surely will resonate with many volunteer boards looking for that type of firm for that particular type of representation. The only problem is that the Firm mentioned in the ad did not list a physical office in the state they were targeting nor were the attorneys shown in the ad's pictures even admitted to practice in the State!

This kind of experience reminds us that boards do need to undertake a certain level of due diligence when selecting professional advisers and other vendors to represent and service their communities. If your board is considering a particular candidate, take a look at what that candidate says about his or her company and then confirm. The very old adage Trust but Verify is a good place to start.

Here are some areas to consider:

If you are vetting lawyers and law firms, verify that the size of their firm is confirmed by the number of attorneys reflected on their website. Even a state's Bar website may contain inaccurate information in this regard. The best way to determine the size of the firm you are considering is to visit their website and count the attorney names you see!

If a professional company or law firm claims to be experts in specialized areas, that reality should be borne out in their published articles and credentials. If you cannot find those anywhere, there may be a problem.

Credentials can be easily confirmed. If someone claims to be a member of a particular society, Bar Committee or other industry group or to be Board-certified, most of those membership lists and credentials are easily found these days via the Internet.

If a vendor claims to have represented neighboring communities, ask for contact information for those communities and follow up with them for referrals.

If a professional adviser touts a blog (yes, like this one!) ask if he or she writes it himself or herself or if it is ghostwritten by a PR company. This last point was a bit of a shock to me when I discovered that some of the blogs I read are not written by the published authors but are, in fact, ghostwritten by a company's PR arm.

You may lament having to undertake this level of scrutiny when it comes to reviewing professionals who should be conducting themselves professionally. More often than not, you will find that the honor system is firmly in place for most of the advisers with whom you would consider doing business and the information being touted is, in fact, accurate. However, for those instances where there is more sizzle than steak, you will want to avoid potential problems by verifying skills, credentials and publicized information.

Doing your due diligence requires common sense, resourcefulness and yes, the willingness to wait to make a decision until you have done your homework.

Monday, January 5, 2015

Question: The association in my condominium is
trying to reassign all the parking spaces, which were originally assigned by the developer in 1969. I have a two bedroom unit and ever
since I moved 15 years ago, I've had two parking spaces, just like
almost every other two bedroom units. Recently, a member of the board
changed how parking spaces are assigned. The new plan allows two bedroom
units only one parking space. The board of directors say that they can
do this by vote. Is this legal? What is the proper way to do it? Thank
you, Enrique D.

Answer: Parking spaces are
ordinarily subject to reassignment by the Board of Directors when they
are common elements. Parking spaces which are appurtenances to the units
are not typically subject to reassignment. The answer to your question
lies in a review of your governing documents to see how these parking
spaces are defined.

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